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Major oil company makes multi-billion dollar move away from fossil fuels

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The world’s biggest mining company is moving away from oil and gas in a multi-billion dollar exit away from fossil fuels

The BHP Group will review its business in petroleum mining and consider a trade sale. Projections suggest the company will earn more than $2 billion this year. The deliberations are still at an early stage and BHP is yet to make any final decision.

An inside source told Bloomberg that the company is worth approximately $15 billion or more. The move comes as BHP follows suit of Rival Anglo American Plc, which has already exited thermal coal under investor pressure.

BHP has long said it plans to make money from oil for the next decade. However, the inside source says the company wants to avoid getting stuck with assets that are increasingly difficult to sell as the world becomes more climate-friendly.

BHP Is Said to Mull Oil Exit in Retreat From Fossil Fuels - Bloomberg

If the price is right

Reports suggest the company plans to exit while it can still get a good price for oil. Unlike other rivals in the oil space, BHP doesn’t deend solely on the energy business for profit. The company’s iron ore and copper units dwarf its energy business.

Experts say that it’s good timing for the company to leave its dealings with oil. The economic recovery from Covid-19 has made oil producers fortunes, with Brent oil futures having rallied about 60% over the past year.

In contrast, BHP’s attemps to leave thermal coal have so far been rather disappointing. Early bids for mines in Australia came in lower than the company’s own valuations last year.

Source

BHP positions itself as a future-forward company

A decision to move away from both thermal coal and petroleum would help BHP to position itself as a future-forward company.

Experts also expect the miner to sanction a huge potash mine in Canada next month. This could make it a key supplier of the crop nutrient when production begins.

BHP has been in oil and gas since the 1960s. It has assets both in the Gulf of Mexico and off the coast of Australia. It produced 102.8 million barrels of oil in the last financial year.

“BHP is an outlier in the mining sector for its petroleum business,” says RBC Capital Markets analyst Tyler Broda.

He suggests that this is often cited in discussions with investors as a “point of detraction”.

“With rising ESG pressures facing the industry, but also as this business potentially enters into a re-investment phase, we can see why management might be contemplating an exit.”

Broda estimates the business is worth about $14.3 billion.

Natasha is an Associate Producer at ticker NEWS with a Bachelor of arts from Monash University. She has previously worked at Sky News Australia and Monash University as an Online Content Producer.

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Boeing face delivery delays following guilty criminal charge plea

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Boeing’s deliveries are down after months of controversy, is it because they can’t make the planes, or because airlines right now don’t want them?

Boeing has agreed to plead guilty to a charge of conspiracy to defraud the United States in connection with the investigation into two fatal crashes involving its 737 MAX aircraft.

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Aviation expert Geoffrey Thomas joins to discuss. #featured

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Blockchain sparks a transformative influence in Australia

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Professor unveils blockchain’s role in transforming the economy and innovative projects taking place at RMIT University.

Crypto Corner explores the latest market movements, expert insights and the influence of macroeconomic factors on the crypto industry.

Crypto Corner is hosted by Caroline Bowler, CEO of BTC Markets.

In this episode, BTC Markets CEO Caroline Bowler interviews Professor Chris Berg, Director of RMIT Digital3 and Co-Founder of the Blockchain Innovation Hub at RMIT University. They discuss RMIT’s cutting-edge projects and the transformative impact of blockchain technology in Australia.

Professor Berg shares insights into RMIT’s Digital3 philosophy, which combines research, innovation, and collaboration to drive the digital economy. Learn about groundbreaking initiatives in blockchain, cyber security, and AI, and how these disruptive technologies are reshaping business, government, and society.

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From $25K to $1.5M in real estate: expert unveils game-changing strategy for investors

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Empower your property investing with these key tips

Wyld Money dives into the world of financial freedom. Whether you’re a seasoned investor or just getting started, join us for actionable tips and tricks to unlock your earning potential, and retire on your own terms.

In this episode, Mark is joined by Dean Fraser, Founder and CEO of BrickFloor. #trending #wyld money

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